Eland to raise US$15mn for Gbetiokun-1 well

Created: Thursday, 12 May 2016 11:53

Eland aims to begin initial production in the well by the second half of 2016. (Image Source: Maarten Heerlien/Flickr)Eland Oil & Gas plc has announced that it will raise around US$15mn to fund operations at the Gbetiokun-1 well in Nigeria

The company will raise the funds by a premium placing of its shares via an accelerated bookbuild, to be launched immediately. Eland’s share price has seen a rise recently after an increase in oil reserves for the Gbetiokun field, which is part of the OML 40 licence and has been estimated to contain gross 2P reserves of 10.8 mbo.

The proceeds of this move will be used to fund the re-entry, completion and production of the Gbetiokun-1 well. The re-entry of Gbetiokun-1 is expected to cost Eland US$6.5mn. The company is aiming to begin initial production by the second half of 2016.

Eland has recently reported a test production of 10,584 bpd of oil from the Opuama-3 well, also in Nigeria.

Eland CEO George Maxwell said, "Following the exceptional success of Opuama-3 well re-entry, we look forward to further enhancing production through the development of the Gbetiokun-1 workover well. The initial rate from the Gbetiokun-1 well is expected to be circa 7,800 bpd of oil gross. This project will once again almost double the company's already significant production profile. This fundraise will facilitate the development of this project in the second half of this year.”